Despite it being the peak of summer, many areas of the UK are currently on high flood warnings. Thanks to June, and July so far, being some of the wettest on record in certain locations, businesses and homes need to think about flood cover fast.
It’s thought major flooding is likely to happen in the UK every year, but there’s still no long-term plan from the government to deal with this – at least not from a business insurance perspective. At present, many insurers in the UK are declining to offer flood cover or applying huge excesses for flood cover (for example £10,000 excess as a minimum) to businesses based on historic and anticipated flooding in their business location.
How can businesses protect against flooding?
At the end of last year, the British Insurance Brokers’ Association (BIBA) announced the launch of a commercial insurance scheme for businesses which will include flood cover for commercial premises or let properties in areas which are at risk from flooding.
The aim is to meet the usual commercial insurance needs of small and medium sized businesses, whilst providing flood cover for businesses that are ineligible for cover otherwise. The scheme is so advanced that detailed risk reflective information allows businesses to have individual cover based on their own specific risk. This includes the flexibility to offer businesses the choice of how much risk they want to bear themselves.
Is it possible to save?
When you consider the likelihood of flooding and having to fork out a huge excess on a possible annual basis, anything that can be reduced in terms of the policy cost or excess is worth exploring. One of our expert insurance brokers managed to offer significant savings for a business who had an increased flood excess of £10,000 when they took the contract. The exposure was £2.6m buildings and £150,000 contents, and the overall business insurance premium the broker managed to negotiate was just £561 + IPT.